👋 Welcome and Firm Announcement
00:00:00
Francisco Sirvent: Good afternoon, everybody. Good to see everybody on. I recognize most of the names, which is always a ton of fun. Welcome, welcome, welcome, everybody.
For those of you I have not met personally, my name is Francisco Sirvent. I’m an attorney at Keystone Law Firm, and I am also the founder of the firm. Today’s webinar is more than a webinar; today is the official announcement of our firm moving into a service that has been requested for, I can probably say, 18 years, since I started the firm. We are officially going to be adding this as a service for our clients who need this.
So, today I’m happy to announce that Keystone will begin offering this as a service. The point of today’s webinar is not to try to sell you this service. Today, the purpose of this webinar is to hopefully share with you a few important criteria that you should use when deciding who to name as your successor trustee. That’s going to be more the focus.
💼 Describing the New Service and Our Approach
00:06:22
Francisco Sirvent: I will definitely be describing our process, and when somebody wants to inquire of us about that service, and how we go about it. So you have some information about how that would look if you wanted to talk to us about it.
We are not opening this up on a grand scale. We are opening this up on a very limited first round of clients, and so we’ll talk more about that as we go. As a small boutique firm in Chandler that takes care of a lot of our clients’ different needs, we like the type of service where we can be very, very high-touch, very white glove, very in tune with what’s happening. And that is not something that you can do at scale, at least we don’t try to do that at scale right now. And so, if you’re interested, I definitely want you to express your interest, and I’ll tell you how to do that when we get to that point. But please know we will be rolling this out in small chunks as we go.
🛑 Legal Notices and Fiduciary Duties
00:07:39
Francisco Sirvent: Oh, lovely, all the legal notices. This is not legal advice, this is not financial advice, this is not tax advice. This is educational information of a general nature. I hope you walk away with a couple of nuggets that help you learn how this works and maybe make some decisions that you’ve been wanting to make for your family. But if you need legal, tax, or financial advice, please consult with an advisor who is appropriately licensed.
Before we jump in, just the general duties of a fiduciary. I’m going to use that word a little bit. I’m going to use a bunch of different terms. Just know that when I say fiduciary, I’m using it in the broadest context. It means it’s anybody—whether they’re a professional, a family member, or a spouse. It’s anybody who is helping someone else take care of their stuff. So it’s whenever somebody else is responsible for another person, they are acting in a fiduciary capacity. So it could be a licensed fiduciary, it could be a bank trust department, it could be an attorney, it could be a spouse taking care of their spouse, it could be an adult child, it could be anybody like that.
00:09:05
Francisco Sirvent: So I’m using it in a very, very broad context for purposes of today. But the duties of a fiduciary, just a quick recap—we have full hour-long or three-hour-long teachings on this.
Naming a Fiduciary
A fiduciary generally, you create your will, your trust, your power of attorney, and you put them in the documents in order of succession: my first choice, my second, third. When somebody is named right there, there’s not really any legal duties they’re taking on just by their name going in your document. We have clients ask us all the time, “Do I need to ask their permission?” Technically, legally, you don’t have to. You can put them in there. I had a friend who named Taylor Swift as the guardian to raise his little kids. He never got her permission. He just thought it would be absolutely hilarious if he died that his executive would have to literally go find Taylor Swift to get her to sign off something that says, “No, I’m not taking care of your kids.”
00:10:06
Francisco Sirvent: You don’t have to get the permission at that point. You’re just putting in the documents as an offer. You’re basically saying, “I offer to you the job first, and if you don’t want to, it goes to the next person in order.”
I think the duties of a fiduciary should be a little bit more; at least they should at least be informed about what’s going on. They should know enough about your situation so that they’re ready to spring into action if there’s an emergency, because in that emergency there may or may not be an opportunity for you to update them. As much as possible, the next person in line should be as informed as you are comfortable informing them. That way, they’re ready to go. You’re naming a healthcare agent, a power of attorney, you’re naming a successor trustee.
Fiduciary Duties During Incapacity
00:11:12
Francisco Sirvent: That’s generally what happens when they’re named. If you become incapacitated, that’s where they spring into action. And at that point, they do have legal duties to start doing something for you. Generally, when it’s surrounding the money, your bills, your property, your real estate, your investments, they have to protect it, collect it, and distribute it for your benefit and following your legal documents. Your legal documents might have some specific instructions, but they have to protect it for you.
And if you’re naming a healthcare agent as well, they’re the ones that do all the other stuff. They are arranging doctor’s appointments. They’re making sure your prescriptions are filled. They’re making sure your living arrangements are correct. They’re making sure at the hospital decisions are being made. If it’s something like a long-term illness—a stroke or dementia or Alzheimer’s—they’re watching and taking care of everything. The healthcare agent may not be the person actually doing all of the things, living with you and taking care of day-to-day stuff, but they have to make sure it’s all in place. That’s their obligation.
00:12:25
Francisco Sirvent: If you have a healthcare agent that’s different from your power of attorney and successor trustee, the latter are the roles for the fiduciary named to manage the money and the bills. The healthcare agent might be talking to them about paying for some of these bills and setting up some kind of a budget and making sure there’s enough money to flow for things like that. So they have to work together for sure.
Fiduciary Duties After Death
After death, of course, the fiduciaries are a personal representative and the successor trustee, and their job is to protect, collect, and distribute according to your wishes. Whether you have a will or trust, their job is to carry it all out. They have to make sure there’s a whole process.
Actually, I didn’t put this in my presentation. I should have. I wonder if I can share this real quick. This would be interesting or at least maybe illustrative. This is one of our internal checklists that we use for—Yes, I can.
00:13:39
Francisco Sirvent: It looks like I can. This will be lovely for when we’re doing that job. So we have a lot of checklists obviously, and there’s a lot to do. So this is a 24-page checklist that we use internally when we’re going through that process after somebody passes away. There’s a lot of stuff to do. Not everything on this list is always applicable, but if you don’t have a complete checklist, you don’t know what to eliminate.
So it goes through:
The executive will go through the process of making sure all your bills are paid.
They’ve got to notify the credit bureaus.
They’ve got to establish that they even have the legal authority to act on behalf of your estate.
They’ve got to send out notices to all of the heirs, anybody else in the trust, and all of potential debts or creditors or bills that you have.
If there’s anything that was left outside your trust, they may have to start a probate proceeding to collect that and bring it back into your trust. That’s just the first stage.
00:14:52
Francisco Sirvent: Then they have to create an inventory. That’s used for multiple purposes:
Used for setting values of things to get the step-up in basis at death.
Used as the beginning balance for the beneficiaries to later understand what they’re going to receive.
Used to make sure there’s enough cash in the trust or the estate to pay any bills or creditors or expenses that are there. They’ve got to create a very solid inventory.
Then they got to deal with the accounting and make sure all of the expenses and debts and bills and creditors and anybody who crawled out of the woodwork, all of those things are satisfied. They’ve got to create an accounting report for the trust or the estate so that the beneficiaries have transparency on what did you spend some money on, where did it go—you know, did you sell the house, did you liquidate some stock, etc.—and how much did you get for it and how much is left.
00:16:22
Francisco Sirvent: And then there’s a final stage where, before distributions are made, there’s a proposal to all the beneficiaries of, “Now that we know what the final balances are, here is what your percentage, your share, your amount of the trust or the estate is,” along with the accounting. “Do you approve?” And if they approve after they’ve had an opportunity to review the trustee’s actions, then they say, “Yes, we approve.” Then the distributions can be made. And along the way, there’s usually at least one or two tax returns that will have to be filed to confirm all tax obligations are satisfied. So after death, all that stuff has to get done.
We go through that in more detail in our other webinars. While I’m thinking about it, you can get to all of our previously recorded webinars from this year on our YouTube channel. Easy to find: youtube.com/keystonelawfirm. I think we have one about that whole process. So, you can go there and learn all about it in great painful detail.
Personal Liability for the Fiduciary
A fiduciary is liable to you while you’re alive and to the beneficiaries after you pass away. So, doing the job correctly is something that we tell all of our clients.
00:17:32
Francisco Sirvent: We do advise, and have for years and years and years. We tell clients who come in and they say, “My parent has passed away or my spouse has passed away. What do I need to do here?” We tell them what they need to do, all the stuff I’m describing. The reason we tell them all the painful full details of how to do this is because when they finally make those distributions, if they didn’t do everything in this order, they are personally liable if there was a mistake, and somebody could crawl out of the woodwork. They wouldn’t go after the beneficiaries; they would go after the fiduciary. They would go after the person who was doing the job.
And even if they did the job right, if they didn’t have all the documentation and their ducks in a row created along the way and they’ve distributed all the money, they’re now going to have to create all of that out of their own pocket and redocument everything and then prove it all out of their own pocket. And so we always tell fiduciaries, you want to be doing this along the way, gathering up your file, making sure it’s correct, and disclosing it to the beneficiaries along the way so that when it’s time for distributions, if there’s a complaint, it comes up during the process and can be fixed or corrected or explained during the process.
00:18:48
Francisco Sirvent: So there’s a lot of personal responsibility that the trustee takes on, or the personal representative or the healthcare or power of attorney agent. They take on a lot of personal responsibility when they act in this role. So doing it correctly means when it’s done, they’re done, and nobody can come after them a year later or 10 years later or something like that.
🧑💼 When to Name a Professional
Those are the duties of the fiduciary. I want to talk a little bit about when you might name a professional. There’s lots of circumstances. I put a few up there that I could think of.
No Appropriate Family Member: The first and probably most common one is somebody just doesn’t feel like they have somebody appropriate in the family that they can name. We do help a lot of clients that don’t have children. We have a lot of clients whose children just aren’t in a stage of life or they’re just not appropriate to be in charge of this. And so they’re thinking, “If I put them in charge, they’re not going to know what to do,” or “They’re just going to do the job poorly because they don’t manage their own money very well.”
Blended Families: Blended families can be a very tough type of estate or trust to administer. Both when the first spouse dies and when the second spouse dies, it can be very, very tricky because of the nuances in the law about the rights of the children of the spouse who died first. And then, of course, when the second spouse dies, if there are children from different marriages, it gets more sensitive. Sometimes clients just think, “I’ll name one from my side and one from your side,” and I promise you that’s just a bigger disaster waiting to happen. You want somebody who is going to be completely impartial. They’re not going to be biased or in favor of either side.
00:21:09
Francisco Sirvent: They can be objective. And they have the sort of intestinal fortitude to tell somebody, “No, that’s not how it’s going. The documents say this.” And so blended families have some extra dynamics.
Taking the Burden Off a Loved One: Sometimes some clients just want to take the burden off a loved one. They just think, “Our kids are perfectly fine doing it, but they’re busy raising their own families and working their own careers, and we just don’t want to burden them with it. Hand it off to somebody else.” You just outsource the work.
Avoiding Potential Grumbling: I can’t tell you how many times I have been asked to consult for a family where parents have passed away. Everybody got along phenomenally while they were alive. Now that they’re gone and one child is in charge of administering the estate, the other ones are wondering, “We’re not getting all the information we thought we would. Are they hiding something?” You know, or one of the kids’ spouses starts kind of whispering in their ear, and it just creates tension.
Making the Professional the “Bad Guy”: The last thing anybody wants to do is create tension in their life. Some kids are just like, “I don’t want to create any tension. We’re just going to outsource this.” A lot of times the trustee has to say, “No, you don’t get the whole house because that’s the most of the estate and you don’t have the money to buy off the other sibling.” So sometimes just tough decisions have to be made, and you can put the professional in the role as the bad guy.
Accountability and Efficiency: And then professionals just generally have better systems for accountability and efficiency, moving things through the process with more transparency that is supposed to be happening along the way.
00:23:22
Francisco Sirvent: Some clients are just like, “I just don’t want my family involved.” Perfectly legitimate. There’s a couple of clients we know of. They just don’t want their family involved in doing all of this work. They want somebody else to do it and for their family to just get checks at the end. Perfectly reasonable option.
🛠️ Keystone’s Professional Trustee Service
As we are rolling this service out, we had to come up with some criteria of when and how we’re going to allow us to be named in these roles.
Limited to Financial Roles
I do want to start with one of our first decisions that sometimes is a pretty important factor. As I described earlier, you’re naming multiple fiduciaries when you’re creating your estate plan. And one of the decisions we had to come to was whether or not we were going to offer for clients to name us as their healthcare decision maker. And our decision was no, we’re not going to.
00:24:47
Francisco Sirvent: For folks who are looking for a professional to sit in the role of a fiduciary, one of the things to know about our offer is that we won’t be named as your healthcare decision maker. Like I described earlier, there’s a lot that goes into that position. They are involved in a lot of care management. They’re involved in a lot of communication with medical providers, doctor’s offices, pharmacies, health insurance, Medicare, hospitals, rehabs, long-term care facilities. There may be benefits for VA or ALTCS that are relevant. And there’s a lot of care management that goes into that scope of service that we just honestly don’t have in-house.
So, I want everybody to know right up front that if you’re looking for a professional to do all of it, you won’t find that here. Where you can find that is through the companies out there that fall under the umbrella of something called a licensed fiduciary. So that’s a different type of license. Those generally are people who have taken some coursework and passed a licensing exam with the Arizona Supreme Court, and they are given a license to act in these roles for compensation for non-family members.
00:26:26
Francisco Sirvent: And so they are licensed to do all three of those things. They are generally in some type of a private practice. You’ll see them anywhere from a solo person who does this to a firm that has 10 or 20 employees or something like that. In Arizona, there’s not very—I don’t know of any big, you know, 100-200 person corporations that do this kind of work. It is mostly small boutique firms that do this, and generally, they’re pretty geographically specific most of the time.
Those licensed fiduciaries, they can do all three. They will do the doctor’s appointments, they’ll rush to the emergency room, they are managing any kind of care staff that’s in the home. They’ll help coordinate just everything that’s happening in their life, from arranging for meals to picking up meds to having nurses come. I mean, they will arrange everything. And on top of that, they can also be managing the bills and paying for things and taking care of the budget on an ongoing basis.
00:27:37
Francisco Sirvent: So, our firm what we’ve decided to offer is only to sit in the financial roles: Financial Power of Attorney and Successor Trustee.
You can split those roles. There’s no problem with that, and it generally works. We see it happen actually more often than you might think. But what that means is if there were an incapacity, you would have somebody else named as the healthcare agent. You might have somebody in your family appropriate for that. If you don’t, you could still inquire with us about naming one of these licensed fiduciary companies in that limited role and placing us in the role over the finances, and we would then collaborate with them in the event of incapacity. And then their role would drop off at death, and then our role on the financial side would continue where we protect, collect, and distribute pursuant to the terms of your will and trust.
So that’s one of the first criteria that we decided on as a firm: we are not going to offer to sit in that healthcare decision-making role. So we’ve got to help you come up with a solution for that. Maybe it’s someone in the family, maybe it’s a professional.
Initial Criteria for Service
00:28:55
Francisco Sirvent: A couple of the other things to think about. Like I said, because we’re a small firm, we can’t onboard a hundred clients at once to do this. We just don’t have the capacity. And so we are going to only offer this first to clients who are currently a Trust Care member with our firm. That doesn’t mean we won’t offer this in the future to others, but our first wave is going to be to invite folks who are a current Trust Care member. You should know if you already are.
00:30:08
Francisco Sirvent: If you don’t, it means you pay us an annual fee to keep your trust and your will and your power of attorney up to date every year, every year, every year. If that’s you, you’ll be welcome into our first set here. And what that also means, just for those who aren’t active Trust Care members, it means that Keystone did draft your estate plan. We drafted all your legal documents initially. That’s something we’re going to require because we know exactly how those documents work. We’ve helped clients administer those through incapacity and after death countless times. They work really well. We’ve also helped people administer documents that were drafted by others. And I won’t say they’re all bad; I definitely wouldn’t say that. But there’s a significant difference in quality, and knowing that we want to do the best job possible and give you our client and your beneficiaries the best experience possible for this initial offer. We’re only going to be working with clients who are active Trust Care members, meaning you’ve kept it up to date and meaning we drafted it.
00:31:28
Francisco Sirvent: So that’s one of the other important initial criteria. If that’s not you and you’re still interested, I’m not discouraging you from expressing your interest at all. Please do, because depending on how much interest we get, we might open this up sooner rather than later to others. So, I want you to express your interest. But that’s what the initial offer will be too.
Also, as a business, we obviously are going to have some minimum estate sizes for the types of estates that we will offer these services to. Unlike, you know, JP Morgan’s trust department or these other trust departments where their minimum is 30 million or 50 million, we’re not looking at those numbers. Our minimum will be $500,000 of some type of liquid assets (IRA, investments, cash, annuities, something like that), because we want to make sure there’s enough money there to do our job through any kind of illness that happens or long-term care, and then there’s enough money there to make distributions. It doesn’t make sense a lot of time if the liquid assets are less than that.
00:32:46
Francisco Sirvent: If you just want to name us to serve after death, we can do that, and our minimum actually goes down to $250,000 of liquid cash. So it won’t be IRAs, because those generally go straight to beneficiaries, but it has to be something that would be managed by us in order for the distributions. You also are welcome to have real estate or business or property out of state; that would not exclude you at all. And we expect there to be real estate or other things that need to be administered or managed. But as far as a criteria, there has to be some liquid funds for payment of your expenses and things, and all the expenses of administration as well as the expenses that need to be paid after death. And so liquidity for us is going to be one of the criteria. Just know that coming into this.
Onboarding and Preparation
We are also going to have a type of onboarding process that I picture is going to make the job done well.
00:34:05
Francisco Sirvent: I don’t like doing things halfway. I don’t like being caught having to scramble. And I’ve seen this happen with so many families where somebody passes away, and they come into the office, they’re like, “I found my mom and dad’s will or trust.” And I’m like, “Great. What do you know about their finances?” They’re like, “I don’t know anything.” And it’s a humongous stress and time commitment to go find everything.
And so for our process, when we are going to agree to be named as a fiduciary, we’re going to do an onboarding process where we’re going to get a very detailed statement and inventory of everything. I’m not asking for an inventory of all the contents of your home. Financial accounts, insurance, all all the contact information of people in your plan. We’ve got a whole list of things that we need to gather and collect from you so that if an emergency happens, we’re not scrambling, and we don’t even know where to go to start paying some bills.
00:35:22
Francisco Sirvent: So anyway, so there’s going to be an onboarding process, and if it’s a fit, you would have to agree to go through that process with us. We can help if you have property in multiple states or accounts in multiple states. That’s not a problem for us. We already help clients deal with that pretty frequently.
One of the unique requirements that we’re going to put in place, it doesn’t have to be done upfront, but as part of, you know, once we’re named and we’re waiting, one of the things we’re going to ask you to commit to is to go ahead and prepay for your burial or funeral or cremation arrangements. Go ahead and get those in place. One of the most stressful things for family members or anybody after a death is, “How am I going to pay 10, 15, 20 grand for this?” Like, “I got to put it on my credit card.” It’s just a stress because it has to happen right away. And so we want that in place so that that stress isn’t there on anybody, and it can just be taken care of.
00:36:28
Francisco Sirvent: It’s also cheaper when you do it that way. It’s less stressful. Everybody’s more organized. So, we’re just going to go ahead and make that part of our process as well.
If you’re familiar with our firm as well, you know, we’ve got Michelle, myself, and my partner Michelle are the two attorneys who’ve been doing this work for a long time. And we have our staff, our team who’ve been here for a long time as well. One of the things that we will be doing, just like we do right now for clients when they hire us to represent them as the trustee, when we’re acting as trustee, we will have our team available for all the work that needs to be done. You know that checklist I showed you that was 24 pages long. We’ll be delegating duties down. We’ll be making sure everybody is up to date on the entire process of how it’s moving forward, and we thankfully have that expertise here in-house to be able to add bandwidth on that and provide what I expect to be the level of service that you’ve come to expect from us.
00:37:49
Francisco Sirvent: What else do I need to go over on that piece? I think those are that’s really most of what we decided on as far as who we could help in this role.
If you did not have Keystone draft your trust or you did but it was years ago and you did not keep your Trust Care membership active, it’s an easy fix. You just jump back in, join back up, and you’re right in that category. If we’ve never drafted your trust before, I wouldn’t tell you to have us draft your trust just for this purpose. I would certainly offer it to you for that, but that’s, you know, you’d have to decide if that was worth it for you. We won’t allow other attorneys to put us in documents for their clients. We won’t be offering that. But if it’s time for you to update your documents anyway and you don’t want to go to the old attorney or they’ve retired or they’re out of state or something, and you want to consider Keystone to draft your trust, then that will wrap you right into the ability for us to offer this service to you during the process of being onboarded.
📞 Next Steps: Expressing Interest
00:39:12
Francisco Sirvent: Actually, I think I’ve got a really beautiful slide for that. Here’s—Yeah, let me go ahead and share this actually.
So, I’m going to put in the chat a link. And if you want to click on that, it’ll probably be easier for you to look at it while I go through the next step. If you’re interested, I cannot give you a commitment that we will do it without a little bit more information. And so what I’m asking for is if you have interest to go to this link that I just posted and submit that interest form. It asks for some basic information. You rattle off all the answers off the top of your head, I’m sure. Hit submit, and it’ll give me a nice organized list of those who are interested.
00:40:32
Francisco Sirvent: I’m going to be reviewing all those myself. Michelle and I will talk about them. Then my office will reach out, and we want to schedule a phone call. There’s no cost for submitting that form. There’s no cost for that phone call.
During this initial stage of us offering this service, we are going to do a lot of information gathering because we want to get this right. We’re going to go slow at first, and as we get it right and get it right and get it right, and maybe tweak a process and get it right and get it right, we will offer it on a more expansive basis. But we’re going to go a little bit slow in this first process. So, if you’re just at all interested, submit the form. You’re not committing to anything other than saying you’re interested, and we will follow up to schedule that phone call.
00:41:30
Francisco Sirvent: On the phone call, we’ll talk about it. We’ll talk about your situation, the information you put on the form, anything else you want to share with us, and we will be able to tell you whether we think it’s a good fit or not from our end. And we’ll share any information we can so that you can make a decision from your end. That’s when the decision is made from your side and from our side.
If the decision is made by both of us, we say, “Yep, let’s do this. Let’s name you guys as our successor trustee. We make the decision.” Then we start with the onboarding information. We’ll go through what that information is. Again, for our Trust Care members, we’ve got probably 80% of that information already, but we need the final 20%, and we might need some of that 80% updated, brought to current. So, you’re already in a good spot with us, and that’s why we’re starting with you guys, but we’re going to go through that onboarding process and make sure we have all of it. Make sure we are dialed in so we know if three days later somebody calls and says, “Oh my gosh, they went into the hospital, there’s an emergency,” we can spring into action.
00:42:32
Francisco Sirvent: We’re not floundering for weeks and weeks trying to find stuff. We’ll go through that onboarding process. Part of that onboarding process is going to require some new agreements, some new service agreements that you sign with us saying you’re naming the firm to do this. You acknowledge the firm will be paid for their services at the time and all these other things that we will go over.
We’re also going to ask for you to sign a document that says, “Here’s your emergency people. Notify this person emergency and also this my emergency people can talk to you,” and so we have a two-way communication going with them. We also are going to ask that you allow us to do regular check-ins with you. Some of our single clients don’t really have any family members who are checking on them, and in the past, they’ve asked, “Can I put you as my successor trustee?” And the answer has been no. At this point, we are going to consider saying yes,
00:43:32
Francisco Sirvent: going through this process with them. And if the answer is yes, we’re going to want to do a regular check-in. “How are you doing? Are you still alive? Tell us you’re still here.” And so those regular check-ins are going to happen as well. We’re going to want your consent to do that. So there’s going to be a lot of that paperwork we have to do upfront.
Once we’re fully onboarded, then we need to do our updates. Trust Care members, you’re used to this. We harass you once a year to make sure your estate plan is up to date. When we’re named in this role, the review is going to be a little bit more detailed because it’s going to go through all of that information that we did in the onboarding. And so, as we work through this with you, we will be completely ready to spring into action and say, “We’re ready to take on the role.”
00:44:30
Francisco Sirvent: A few of the things that are a little bit unique and how, you know, how are they going to work? There are clients who have safe deposit boxes. You know, we’re going to have to work with you on how to protect access to that safe deposit box, protecting access to your house, protecting access to your vehicles. These are all assets that come with liability if they’re not protected. And so, we’ll work with each person individually on how that access is going to look. One of the things we don’t want to do is we don’t want to take control or have access to anything until we start serving, right? Because if we do, we have liability for it, and we want it to be in your control, your possession. And so, we got to have that smooth transition plan for even all the unique things like that.
As part of that regular update, we’re going to be doing at least quarterly phone calls and at least once a year either video or in-person meetings to go through the full audit. And then the whole process of what we will do if you’re declared incapacitated or you have a medical emergency, we have a whole checklist we want to go through with you to make sure it’s correct for you.
00:45:44
Francisco Sirvent: And we have a whole checklist of what happens when you pass away to make sure again that’s correct for you. So we’ve got some marching instructions from you, and all of that is going to be how we go through this. Now, right in the middle of that slide is where the decision is made. Before that, it’s just interest and a phone call.
So again, if you have any interest, even if it’s like, “Maybe next year,” I would like to know. It helps me just know how much interest is there for this, and it helps me prioritize where we focus our firm’s efforts. So click on that link, start filling that out, and we will make sure to follow up appropriately.
💲 Fee Structure
I do want to give you information about the fees. Our firm obviously, we’re a business. We need to be paid for our time. It’s not going to be hourly. I personally abhor hourly billing. I just think it creates an incentive in the wrong direction, and I’ve seen that too many times with other law firms. So, it’s going to be on a flat fee basis.
Fees While Named (Not Serving)
00:46:54
Francisco Sirvent: The onboarding fee is going to be a one-time $1,500 flat fee, and annually it’s going to be $750 after that. This is while we are just named in the documents. Our firm did decide to charge fees to be named. I know a lot of other professional fiduciaries and bank departments don’t do that. So, that’s a significant difference between us and them. The reason we decided to charge a fee for this is because of the level of service I want to offer. And I know what this onboarding process is going to take. I know what the annual review is going to take.
Fees When Serving (Incapacity or Death)
That ends once we begin serving.
Incapacity: If there’s an incapacity and we step in as power of attorney and successor trustee, our fees will be based on the value of the assets, and it’s $1.5\%$ per year up to $\$3$ million and it’s then $1\%$ for anything additional. Our minimum first-year fee is $\$1,750$, and our minimum second-year fee (or second, or third, or fourth) is $\$1,250$. So those are the flat fees for incapacity.
00:48:12
Francisco Sirvent: * After Death: It’s essentially very similar. It’s $1.5\%$ per year up to $\$3$ million plus $1\%$ for anything above $\$3$ million. And it’s a minimum first-year fee of $\$17,500$ (but that’s discounted if we did do the incapacity work because we’ll obviously be already up to speed). And then second-year minimum fee is $\$7,500$.
What does that include? It includes all of the marshalling and gathering and protecting of the assets. So whether it’s real estate, financial investments, bank accounts, vehicles, it’s making sure they’re all protected initially. It’s making sure all legal notices go out to all the affected people, creditors, beneficiaries, heirs, anybody who’s on the list. It’s making sure we do the inventory, the accounting, the final distribution proposal, and the final distributions. It’s all that work that happens in between, all the way up and through writing the final checks out to the beneficiaries.
00:49:37
Francisco Sirvent: If it’s a trust asset. If it’s an asset or an account that has a beneficiary on it, those, you know, if it’s got a beneficiary directly to your kids, those go directly to the kids. We don’t touch those. So, we might tell them, “Oh, hey, here’s, you know, it’s at Fidelity. Call them, you can get it.”
We will also coordinate the tax return and work with the CPA to do it, but the cost of the CPA will be additional. Realtor fees would be additional. There might be additional fees for, you know, if your estate has something that has to go through probate, there’ll be additional probate legal fees. If somebody contests your estate, we will have to hire a law firm to defend against that. Those legal fees would be additional. If we have to hire an estate liquidator, there could be additional costs on there that are not part of the typical trustee’s job. But those would all just be expenses of the trust or the estate.
00:50:38
Francisco Sirvent: That gives you a quick snapshot. Obviously, once you get to the point where you are in the middle of this and you’re saying, “Yes, let’s do it,” and my firm is saying, “Yes, let’s do it,” there will be a whole fee agreement that you sign off on. So you’ll have an opportunity to review all the terms of that agreement and how it works and is written. That way you have full opportunity to understand exactly what is included and what would be additional.
Let me just look through my notes and see if I missed anything. Those were the big points.
First-Choice vs. Backup Naming
00:52:12
Francisco Sirvent: There is a difference in naming us as your first choice to serve in these roles versus naming us as a backup.
Naming us as your first choice (so, if you’re husband and wife, you name each other first and you name us as the successor, or if you’re single and you name us as your successor), that’s the category where we have to do the full onboarding and the annual reviews.
If you’re naming your spouse and then you’ve got one child, but you want to name us after that child, again, I want you to submit that form and tell us you’re interested because we still want to have a conversation before you do that. But if you’re naming us as a second or third successor, we are not going to go through the full onboarding process and annual reviews with you because we’re going to essentially expect that your first named person is going to do the job.
So there’s a difference in level of commitment from you in terms of payment and onboarding work if you want us to serve in the second or third successor position. Just know if that’s the case, we don’t need to go through all of the work of onboarding if that’s the case.
Fee Waiver for Initial Clients
00:53:35
Francisco Sirvent: And then I did want to mention that as we roll this out right now, and just until we say otherwise, we are going to wave this onboarding fee for anybody who agrees and we agree to be named. We’re going to wave that because, like I said, this is the first time we’re doing it. We’re going to invest a lot of manpower into making sure it’s done right, but because it’s the first time, we’re going to find things along the way where we go, “Oh, we should have done this. We should have collected that piece of information. Go back. Let’s get it from the client.” And so, there’s some SOPs that are internal that we’re going to be dialing in.
00:54:26
Francisco Sirvent: And so for those of you who are interested in this first stage, if we accept it, we’re going to wave the onboarding fee, and you won’t have to pay that because, like I said, we want to make this a good experience from you. We need to learn our side of it as well. And so we’re just going to be looking for you to give us feedback as we go through it to say it could have been, you know, you could have tweaked this or tweaked that, and it would have been better. We go, “Great. We’re going to improve that part of the process.” As a business owner, that’s the investment I want to make into these first few clients that we take on. And then after we get our process really dialed in, then that fee will apply to new clients in the future. So, just know, put your name on the interest list, and if we accept it, we will then do that.
❓ Questions and Conclusion
00:55:39
Francisco Sirvent: Sherry, is the $\$750$ annual fee in addition to the Trust Care fee? Yes, Sherry, it will be in addition. And we’ll go over those details for clients who get to the point where we both agree and how that affects it.
Paige, is there a difference in fees for second or third successor? Yes. If you name us as first, if we agree and you name us, then the fees that I described are the fees. If you name us as second or third, there’s no fees whatsoever. Unless it gets to a point where your first choice—where everybody above us declines—and then we have to serve, then our fee schedule will apply. But until that point, there’s no onboarding fee, there’s no annual fee, and there’s no fee for work because we’re not doing the work. The ones named ahead of us are. So, there’s no fees for naming us as a second or third or fourth or tenth or however many down the line.
00:56:47
Francisco Sirvent: Any other questions? A few more minutes. We can do this. Just so everybody knows, thank you for your questions. This is being recorded. We are going to share this recording on our YouTube channel. So, you’ll be welcome to watch it again. If your spouse couldn’t make it, you want to share it with them. If you have a child who is like, “I don’t know if I want to be trustee,” and you want to share it with them, you’re welcome to share this with anybody. It’ll be on our YouTube channel shortly.
Frank, do I need to re-what I signed in August or was it all covered? That’s a pretty specific question, Frank. I’m probably going to have you submit your question into the email or phone call. You can send an email to hello@keystonelawfirm.com. Since you’re asking about something you signed in August, I want to make sure you get your specific question answered, Frank. Okay. But there’s the email if you want to submit a question in, because then we can review your file and see exactly what was done.
00:57:53
Francisco Sirvent: Any other questions? Anybody have trouble accessing the link to that form? Somebody give me a “Yes, you got it.” Make sure it came through. No problems.
All right, then. Let me give you a plug for the next webinar that’s coming up on December 8th. Michelle will be doing a webinar called Will She Remarry? Will He Forget Your Kids? Blended Families Can’t Use Cookie Cutter Plans. So, highly recommend you attend that one if you have a blended family, or if your parents have a blended family. I think it’ll be very educational. I’m going to put that in the chat, the link to register. If you haven’t done that already, you can go ahead and register for that. And then on December 11th, certified financial planner Carmy Gutman will be presenting on one called Is History Repeating Itself? Is This the Tech Bubble 2.0? So December 11th if you want to hear his thoughts on the market and the tech bubble, you’re welcome to join.
If there’s no more questions, I will close us out. If there are, you’re welcome to send them into that email, hello@keystonelawfirm.com, and we’ll get back to you as soon as possible. Thank you everybody for attending. I hope you all have a wonderful, happy Thanksgiving, and we’ll see you guys on the next one. Have a great day, everyone.
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